Council begins work on 2013 budget

September 18, 2012

NEGAUNEE - The Negaunee City Council will need to trim nearly $100,000 off its proposed 2013 budget or use the city's fund balance to balance its general fund.

The council got a look at the proposed budget at last week's meeting, and learned there are an estimated $3.446 million in revenues and $3.545 million in expenditures, leaving a $99,114 shortfall.

The current year's budget, estimated at $3.917 million in revenues and $3.225 million in expenditures, leaving an estimated $691,561 surplus.

However, that surplus could change as the year progresses, City Manager Jeff Thornton said.

"Sometimes we get bills that come in at the end of the year that need to be paid," he said.

The council will also be looking at what equipment purchases should be made next year, using revenues from a millage that was approved by voters In August.

"This is a strenuous time every year," Thornton said. "There are some questions that we will have to address. Of course we will have to talk about the equipment. The voters of Negaunee did approve an equipment millage and there will be some decisions on how that needs to be spent and different things like that."

According to Thornton, the difficulty of the budget process depends on several things, such as how the U.S. Department of Agriculture bond funding from the wastewater project will be distributed. The city will use a portion of the funding to reimburse itself for funds that were used to provide for the initial costs of the wastewater project, which is a wastewater transmission line that will connect the city of Negaunee to the Ishpeming Area Wastewater Treatment facility.

The USDA requirements still have to be determined as to how the funds must be redistributed within the city, Thornton said. The city's budget depends on what funds need to be reimbursed first.

According to Thornton's annual budget letter, an increase to the city's fee schedule in water and electric utilities is recommended to cover the rising cost of providing the services. The cost of electric was raised by 2 percent and the cost of water was increased by 3 percent, Thornton said.

"These numbers came straight from the Negaunee-Ishpeming Water Authority, so it's not just coming from us," Thornton said. "We can't eat that cost."

A motion, which was unanimously approved, was made to hold a public hearing Oct. 11 for the 2013 budget.

Budget workshops open to the public will be scheduled for October at the Negaunee Senior Center, with dates to be announced later, Thornton said.